Ladies and Gentleman, let me tell ya'll a bit about myself. I work for a Second chance finance company. I have spoken with the staff and have permission to help with any of your finance questions.

I decided to do this after hearing too many stories from O/O who have no idea what they are signing when they get their first truck.

I'm not here to point the finger or to shift the blame. I am here to educate the O/O in making the best possible decision before financing their truck.

As I tell all of my clients. I am here to make sure you, the O/O, are profitable for you and your families.

So go ahead and let me have it.

Thanks, MartyCAG, for agreeing to help our members with truck financing questions. Drivers, this guy is an expert on truck financing and he will be happy to answer your truck financing questions for FREE even!

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First of all....Thank you for the assistance.

Right now, at this stage in our careers, my wife and I are not quite ready to buy a truck. We hope to be at that point in a couple of years.

What I'm wondering is this....Is a lease ever a better choice for a person or persons who are just getting started towards becoming more independent?

I know people say it's like paying rent.....But sometimes isn't it better to pay the rent until you can get into that house that you want?

Thanks in advance.

That's a good question and a soft spot for me...

IMHO...

I don't feel a lease is the better deal for a few reason..Yes, you will probably get a lower payment and yes it will require less money down. So it sounds like a sweet deal at first. What happens if you have a 60 month lease and you decide you want to upgrade that truck in 3 years. Your payoff will be the remaining lease payments plus and residual payment that you have. Since you put less money down your principle balance will be very high. As fast as equipme deprciates you will have a negative equity situation. Which means you will owe a ton more than what that truck is worth. Which also means that it will take a boat load of money to get out of it.

Another thing to take into consideration are your future goals. Allot of lease and finance companies DO NOT report to the credit beureus or paynet. So if this is your first commercial loan you pay a higher interest rate as a start up company. So if your loan does not report to the C.B. the big finance companies will not recognize the fact that you have commercial credit and will be right back in the same boat 2-3 years later.

I feel it is better to finance a truck with a considerable down payment for the shortest term possible. Start ups will pay a higher rate so the shorter you have to pay the higher rate, the better off you are.

Do your homeowork. In most state there are NO disclosure laws on commercial truck loans. Most drivers don't know what their rates are or even know they are in a lease until it's too late. Make sure you know what your getting into.

Make sure the rate is what the rate is. There is this neet little thing called a running or a rolling rate. They say it's only 10%. WOW, well that rate is not base on an APR. It's actually based on the running balance of the loan. In all actuality you'll be paying in the high teens or even low 20's without even knowing it.

Hipe this help

Depending on the customer depends on the rate.

Credit is based on 4 tiers A,B,C,D

A Tier rates 6 to 9%
B Tier rates 9.5 to 12%
C Tier rates 12.5 to 18 %
D Tier rates 18.5 to 30% ( really depends on the total risk of the deal )

A and B tier rates fluctuate greatly depending on programs offered by captive lenders or what the lender can buy the money for.

As far as down payment money. This also depends on where the customer falls as far as credit. Of course the higher the rate, the more you would want to put down. I think something to shoot for would be 20% down in the higher tier rates. A and B tier rate customer could get away with 10% down.

The biggest thing is to know where you fall with your credit. Be aware of certain situations that can effect your credit score and the rate you will qualify for. Also commercial lending is night and day when compared to consumer lending. Just because you have a 700 credit score doesn't mean you will qualify for A or B tier rates if you have never had a commercial loan and have had you CDL for only a few months.


If a Customer HAS to use a bank with Higher rate. Make sure it is a lender that reports to your credit report and paynet. This will ensure that you get the proper credit for the loan so you will not have to pay a higher rate the next time around. This is assuming of course you pay on time and take care of what ever put the customer in that position to start with.

I was about to ask what credit scores related to which tier of credit but you had to go and throw in that other variable of no commercial loan history.

I was just looking at a truck at a used truck dealer in utah but they tell me there rates run 12 to 15% with approved credit. That seemed high to me but i have been out of the truck owning bussiness for a long time. Still I was thinking around 10%

Still though 6 years ago my credit was good enught to get almost any sum with just a signature. however I had my asphalt co go under and gt into trouble so it is fair to say my credit score isn't what it was.

pm me if you think you could help me figure out what rates I should be able to get so that I don't get bent over.

keeping up with the thread thanx for the info

PM Sent and bump the thread

I've got a friend in a 3 yr lease with a $1 buy out. Whats your opinion of that? In my opinion its just TERMED a lease when in reality its a loan.


I must be one of the lucky ones. I have a local bank that does a great job so far with financing. After hearing all the stories of those that their local bank won't work with them I feel lucky.

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